Over the last 20 years, credit cards have gained widespread acceptance as a means of paying for goods and services. In 1991, American consumers used credit cards to spend in excess of $250 billion. Worldwide, the value of credit card transactions exceeded $600 billion. As used herein, the term "credit card" is intended to include credit cards, charge cards, debit cards, and other financial account cards. Credit cards in use today typically include embossed characters that indicate the name of the cardholder, the account number, and an expiration date. Virtually all current credit cards also have a magnetic stripe containing the account number, expiration date and other information.
Before most retail transactions involving credit cards are completed, merchants seek authorization from a credit card issuer in order to verify the validity of the credit card and minimize the risk of fraudulent or unauthorized use. Over the years, merchants have relied on a variety of methods to obtain authorization. Initially, card issuers provided printed "warning bulletins" that listed the account numbers of credit cards that merchants should not accept. Subsequently, merchants were able to receive "on-line" authorizations by providing the account number, expiration date and purchase amount to the issuer via telephone. Initially, this was accomplished speaking to an operator. The operator entered the data into a computer terminal and provided an authorization code verbally to the merchant. Later, merchants were enabled to enter the data via a telephone keypad and receive an audible authorization code from an audio response unit. Further advances have allowed the merchant to enter the data by means of a keypad on a dedicated data card transaction terminal. Many of these terminals automatically dial a card issuer's telephone number, transmit the proposed transaction data (including account number) via modem, and display an authorization code received from the card issuer.
It became apparent a number of years ago that both fraud and errors could be minimized if there were some means for automatically reading the account data from the credit card, rather than requiring manual data entry. In addition, the amount of time required to process each transaction could be drastically reduced. As mentioned above, virtually all credit cards now include a magnetic stripe containing the cardholder's account number, expiration date and other information. A magnetic stripe or "card swipe" reader is often employed in a data card terminal for automatically reading the information from the magnetic stripe. With these terminals, a merchant swipes the credit card through a slot and the terminal automatically reads and decodes the account number and expiration date from the card's magnetic stripe. The terminal then prompts the merchant to enter the purchase amount. Once the data is acquired, the terminal automatically places a call to a host computer, transmits the transaction data to the host computer via modem, and displays the authorization code received from the host computer. Examples of such terminals are found in pending U.S. application Ser. Nos. 07/790,658, filed Nov. 8, 1991, entitled "Card Transaction Terminal", and 07/820,401, filed Jan. 10, 1992, entitled "Data Card Terminal with Embossed Character Reader and Signature Capture", both assigned to the assignee of the present application, and in Chang et al. U.S. Pat. No. 4,788,420.
Industry data indicates that a credit card's magnetic stripe is unreadable in approximately 8-12% of credit card transactions. This situation occurs when the magnetic stripe has been damaged or intentionally destroyed. In cases where the magnetic stripe is unreadable, the merchant must read the account number and expiration date from the embossing on the card and provide the transaction data to the card issuer using one of the less automated methods described above. As a result, the advantages of automated data entry are lost (e.g., the risk of error is increased).
In cases where the magnetic stripe is damaged, it would be desirable to automatically read and decode the account number from the credit card's embossed characters. If the embossed account number can be read automatically, the chances of error are reduced.
Devices for automatically reading embossed characters on a credit card are known in the art. Examples of such devices are described in U.S. Pat. Nos. 4,119,270, 3,825,727, 3,814,905, and 3,806,707. These prior art embossed card readers are used in a variety of applications, including equipment used by card issuers to verify that the magnetic stripe data corresponds to that embossed on the card, equipment used to match embossed cards with pre-printed mailers, and large point-of-sale terminals.
White et al. U.S. Pat. No. 3,806,707 describes a point of sale credit card terminal which employs a "bed of nails" matrix approach to reading the embossing. Reading is achieved through an arrangement of sensing pins that are independently mounted in close groupings in a block and biased by individual vanes of a common leaf spring. Pin condition is sensed either through means of electrical contacts activated by the pins or electromagnetic sensors which change in condition responsive to the movement of the pins. In the embodiment therein described, the pins are grouped in groups of five on generally rectangular coordinates so as to achieve a discrete pin condition for each of the numbers zero to nine, inclusive.
The terminal described in the White et al. patent appears to require provision of a separate matrix of pins and springs for each character or numeral to be read, thereby necessitating multiple circuits, springs, pins, etc. and increasing cost, size, and complexity. Since the card is read while statically held, the pins and support block would not be suitable for reading embossings on a moving card.
Merchants desire to minimize both the costs associated with credit card transaction processing and the space occupied by the card transaction equipment, especially equipment used at point of sale. Consequently, modem card swipe terminals have become more widely used as they have become less expensive to acquire and use and more compact. Embossed card readers such as those described in the above patents are not in widespread use, perhaps because the known approaches for reading the embossings are large, bulky, complex, and expensive. As a result of the size of the "bed of nails" approach, it is not suitable for integration into a modern, compact point-of-sale credit card terminal. The complexity of these prior art embossed card readers also results in their cost exceeding the price most merchants would be willing to pay for the ability to automatically read the embossed characters on a credit card.
Lockard U.S. Pat. No. 3,774,015 describes an optical reader for an embossed card wherein a single fixed read head is utilized. Driving wheels engage the embossed card and transport the embossments thereof serially past the read head. The read head includes a plurality of optical transmission lines, which are purposely selectively shuttered by the raised embossments. A light signal transmitted through the optical transmission lines is selectively shuttered to provide an intermittent optical code identifying each individual raised embossment of the serially arranged array. While this approach provides the advantage of a single read head and includes a structure which positively biases the read head into positive engagement on the inclined surfaces of individual embossments, a worn card with flattened embossings may not be high enough to shutter reliably. Optical read heads also may be affected by changes in the background color or reflectivity of the credit card surface. Such changes may affect the amount of light received by the optical read head and may affect the accuracy of the read cycle. Moreover, the optical shutter is susceptible to build-up of dirt and must be cleaned often.
Hill et al. U.S. Pat. No. 4,215,813 describes an embossed card reader comprising a head having a plurality of moveable fingers disposed to sense the holes or embossing when a card is moved relative to the head. The fingers carry light guides thereon which are spaced from and disposed to transmit light from a fixed source. A light cut-off shield is disposed between the source of the light and the light guides to intercept and prevent or permit transmission of the light when the fingers pass over the embossed indicia or holes. A principal disadvantage of this approach to embossed reading is that a number of small complex parts (e.g., lamp, light pipes, mask or shield, height adjustable arms, spring wire fingers, light sensors, electronics for light sensors, etc.) are required to provide the mechanism for biasing the fingers into contact with the embossing and maintain proper alignment. While the reader has been employed with success in card verifier inserter systems, it has proved difficult to down-size and manufacture cheaply and reliably for mass production type credit card terminals. Since this approach is designed to read the back of a credit card, it is not suitable for cards encountered by merchants. It is not uncommon for cardholder's to place stickers on the back of the card. Such stickers would likely cover at least a portion of the embossed characters and would prevent the reader from properly detecting the embossed characters.
By reading embossed characters from the front or top surface of the card, the difficulties created by stickers and other obstructions are avoided. However, the condition and elevation of embossed characters relative to the surface of the card may vary from one card to another, and may make it difficult to accurately read the characters on different cards. The variations in the elevation of the embossed characters typically relate to the age of the card and to the amount of wear and tear it has experienced. New cards may have relatively elevated characters with sharp, well defined vertical sides. Older, worn cards may have shorter, rounder characters. Consequently, an embossed card reader capable of reading the variety of cards typically encountered by merchants must be able to read the short rounded characters found on older, worn cards, and the sharper, more elevated characters found on new cards.
Therefore, there is a need for an embossed card reader that is small enough to be integrated into a compact point-of-sale terminal that includes both a magnetic stripe reader and an embossed card reader. Such an embossed card reader must have a cost that is not prohibitive to merchants. In addition, such an embossed card reader must be robust and capable of reading credit cards that are worn and/or warped.